They also confirmed that Osborne will maintain his strategist role for the Conservatives, saying "it is a strength, at a time of economic crisis, to have a chancellor who regularly attends meetings at Downing Street".

Calls for Osborne to step down have been widespread, after Wednesday's grim economic figures suggested the economy had shrunk by even more than expected.

Former Tory prime minister John Major joined Labour's calls for Osborne's resignation, arguing that the chancellor was "not a political strategist".

He said: "I think it is important the chancellor steps away from the immediate picture and tries to build a bigger one. The Treasury deserves the chancellor to be there on a full-time basis and to ensure it develops a proper economic strategy."

Conservative backbencher Nadine Dorries suggested that Osborne should instead give up his role as chancellor, tweeting: "For the sake of country and Conservative party, most trusted politician in UK, William Hague, needs to become chancellor."

Yet the prime minister is not alone in his support for Osborne. Yesterday Angel Gurria, secretary-general of the OECD, told the Today programme that Osborne should "stay the course" in the Treasury.

Publication of figures on Wednesday showing a 0.7% contraction in the economy led prominent members of all parties to revive their accusations of Osborne of being a "part-time" chancellor.